Al Gore: A message for Indonesian students?

Al Gore: A message for Indonesian students?

By David DeRosa

NEW YORK (Bloomberg): Vice President Al Gore's controversial
Kuala Lumpur speech last week on democracy and political freedom
has Malaysia's powers that be doing back flips.

The latest reaction was from Prime Minister Mahathir Mohamad
who summoned the U.S. ambassador Monday to give him a piece of
his mind. One by one, Malaysians loyal to Mahathir have lined up
to express their revulsion at Gore's remarks.

It wasn't just Malaysian officials who took offense. Take
Richard Holwill, director of international affairs for direct
seller Amway Corp., who said Nov. 17, "The American business
community wishes, I believe, to apologize for the very poor
manners of the vice president." Well, who elected Amway to speak
for the American business community?

Some other business leaders were quick to jump on Gore. We
were "mortified" said Kate Clemens, a spokeswoman for the U.S.-
ASEAN Business Council, whose members include General Electric
Co. and American International Group.

Meanwhile, all this leaves investors with an even more clouded
picture of Asia. Political risk now dominates financial risk, as
in the case of Indonesia. Malaysia may be the next place for a
revolution if anything further untoward happens to former Deputy
Prime Minister Anwar Ibrahim, Mahathir's jailed political rival.

Put away the small, self-interested reactions and fake
outrage. Something quite remarkable has happened. For decades,
the U.S. has been taken to task for supporting third-world
totalitarian regimes for purposes of political expediency.

Actually, the American record is mixed. The U.S. supported the
late Philippine dictator Ferdinand Marcos for many years but then
engineered his removal in favor of democracy.

The same thing happened with ex-dictator Manuel Noriega, who
former U.S. President Jimmy Carter accused of stealing a
Panamanian presidential election. Noriega is now incarcerated in
the U.S. following his 1992 conviction for drug trafficking.

The U.S. has certainly given convenient support from time to
time for friendly dictators but there are a great many cases
where it called for and supported democratic freedom movements.

So Gore's remarkable speech isn't really so much a change of
course as it is a declaration of renewal of American commitment.
It was a good speech -- maybe the best of his lifetime. It took
courage to deliver it right into Mahathir's face.

In a way, the speech was in the style of John F. Kennedy,
although it falls a little short of the ringing words of JFK's
inaugural address: "Let every nation know, whether it wishes us
well or ill, that we shall pay any price, bear any burden, meet
any hardship, support any friend, oppose any foe, to assure the
survival and success of liberty."

The question is what does Gore's speech tell the rest of Asia,
Indonesia in particular. The most famous line of the address is:
"We continue to hear calls for democracy, calls for `reformasi.'
We hear them today -- right here, right now -- among the brave
people of Malaysia."

As a matter of fact, Indonesia, the fourth-most populous
country in the world, is literally imploding under political and
economic pressure. Students are rioting in the streets and the
army is killing them. And what do the demonstrators want? They
are demanding a free, democratic election. They want President
B.J. Habibie, the appointed successor of former President
Soeharto (and his adopted son), to step down.

The Indonesians also want Soeharto investigated for abuses of
power in the course of his 32-year term as president.

The government is showing some signs of cracking. Two of
Soeharto's children are under investigation. His son Tommy can't
leave the country and daughter Tutut is being questioned on
suspicion of corruption. It seems she personally owned a
considerable portion of the national toll-highway system. The
trump card is the old man himself. You'll know Habibie is really
feeling the heat if he hands Soeharto over for prosecution.

That leads me back to Gore's speech. Noble sentiments are fine
though they don't mean anything unless backed up by action. If
the Clinton administration is really supportive of the reformasi
movement, then what is it doing voting for massive aid for
Indonesia from the International Monetary Fund? How can Gore
maintain we are with the reformasi when we are propping up
Habibie with billions of dollars of IMF bailout money?

The writer is president of DeRosa Research and Trading and an
Adjunct Finance Professor at Yale School of Management. The
opinions expressed here are his own and don't necessarily
represent the judgment of Bloomberg LP or Bloomberg News.